With the current economic downturn driving intense budget scrutiny and belt tightening, companies are trying to better understand spending patterns in an effort to uncover areas of possible savings.
An often overlooked area where savings can be realized is facility maintenance.
And one of the best ways to gain a better understanding of maintenance spending and help uncover and acquire savings is through the implementation of benchmarks.
Understanding Benefits Of Maintenance Benchmarks
The International Facility Management Association (IFMA) points out that the term "benchmarking" is widely used in today''s business environment, but is often misunderstood.
In an effort to clear up any confusion, the association defines benchmarking as "a continuous and systematic management process that measures work processes, protocols and services for the purpose of organizational comparison and improvement."
A good maintenance benchmark program will allow you to assess various aspects of your operations in relation to similar organizations, as well as industry best practices.
When properly applied, it will allow you to gain control and insight into your maintenance spending by helping you identify costly or inefficient processes.
It will give you an increased ability to make smarter and more strategic decisions regarding spending and develop plans designed to help you make improvements or adopt best practices.
When you implement a maintenance benchmark program, you will quickly learn if the level of your maintenance spending is on par with the quality level — perceived and real — of your facility and the expectations of your tenants.
It will also help you identify those categories where your spending is higher than it should be, based on industry or market averages.
In those cases where you deem your spending is too high, you are then better equipped to negotiate rates with your current providers or release a formal request for proposal (RFP) to obtain a lower cost.
Implementing A Maintenance Benchmark Program
Before implementing a maintenance benchmark program there are a few key decisions you need to consider.
The first step is to choose the specific categories within your maintenance operations that you would like to benchmark.
Along with identifying such factors as service levels, in-house productivity or processes, you can also look at maintenance, janitorial and even utility costs.
Once you have identified the categories, you then need to establish clear objectives for your benchmark program.
What do you want to accomplish? Do you want to: Lower your maintenance costs; increase productivity; justify increasing your costs to reach a perceived level of service; renegotiate service contracts; or simply gain a greater understanding of how and where your budget is being spent?
Finally, you need to identify available resources and decide whether you will conduct the benchmarking process independently or seek out an industry partner to implement and manage the program.
There are a number of industry groups and organizations that conduct research and gather industry benchmarking information.
For example, IFMA offers an "Operations and Maintenance Benchmarks" report on its website, which it updates on a regular basis.
There are also a number of companies and consultants that can help execute and manage maintenance benchmark programs.
If you decide to seek out the assistance of one of these consultants, it is important you choose a partner that will help ensure the breadth and success of your program.
The right consulting company is one that has access to a substantial amount of up-to-date data.
It should also possess relevant information about your industry and type of facility and have the real-world examples and strategic insight that is needed to help you act on the data uncovered by the program.
Ensuring Success Of Your Maintenance Benchmark Program
Simply implementing a maintenance benchmark program does not guarantee its success or result in increased savings.
To ensure success, it is important that your benchmarks are analyzed in relation to a peer group, usually defined for the purposes of comparison.
Not only do you need to consider such factors as the size, location, function and age of the facility, you also need to make sure you are comparing similar services and processes.
If you are benchmarking against a particular industry or industry segment, you also need to make sure the scope of work and service level agreements (SLA) are consistent.
Benchmarking is often seen as a one-off event.
However, it should be treated as a continuous process where your organization repeatedly seeks to challenge and improve its practices.
Once you establish a benchmark and put in place a change, it is vital that you monitor the success of that change.
For example, if you negotiate a lower rate or make improvements to your specifications, confirm that the service provider executes on the terms of the agreement.
Finally, to fully realize the benefits of a maintenance benchmarking program, it needs to become an active part of your planning and budgeting process.
Gaining A Seat At The Table
A properly implemented maintenance benchmark program can help you gain greater insight into your maintenance spending and get your costs in line with the quality level desired.
Taking a strategic approach with the program and considering important factors at the beginning will significantly impact the success of the program.
A successful program with actionable benchmarks will do more than just identify areas where you can improve your facility operation; it will also give facility maintenance a seat at the executive management table and elevate it to a more strategic level.
FacilitySource (www.facilitysource.com), the leading facility maintenance and management service provider, has a wide variety of customers, including retailers, shopping centers, restaurants, auto parts stores and other companies with geographically disperse real estate portfolios. With more than 50,000 locations served and a database of more than 10,000 vendors, FacilitySource provides web-based transaction management software, vendor management and research, statistical analysis and reporting and paperless invoicing.